How Does Marriage Affect Your Taxes in the United States

Getting married, tax wise might just be the last thing on your mind but it’s necessary to understand its impact on your taxable income, as it will save you from unnecessary liability.

Firstly your tax rate changes in response to change in marital status

Take a look at the tax rate in the United States below:

Single

Taxable Income Tax Rate
$0—$9,275 10%
$9,276—$37,650 $927.50 plus 15% of the amount over $9,275
$37,651—$91,150 $5,183.75 plus 25% of the amount over $37,650
$91,151—$190,150 $18,558.75 plus 28% of the amount over $91,150
$190,151—$ 413,350 $46,278.75 plus 33% of the amount over $190,150
$413,351—$415,050 $119,934.75 plus 35% of the amount over $413,350
$415,051 or more $120,529.75 plus 39.6% of the amount over $415,050

Source: https://www.irs.com/articles/projected-us-tax-rates-2016

 

Married

Taxable Income Tax Rate
$0—$9,275 10%
$9,276—$37,650 $927.50 plus 15% of the amount over $9,275
$37,651—$75,950 $5,183.75 plus 25% of the amount over $37,650
$75,951—$115,725 $14,758.75 plus 28% of the amount over $75,950
$115,726—$206,675 $25,895.75 plus 33% of the amount over $115,725
$206,676—$233,475 $55,909.25 plus 35% of the amount over $206,675
$233,476 or more $65,289.25 plus 39.6% of the amount over $233,475

Source: https://www.irs.com/articles/projected-us-tax-rates-2016

The federal income tax of the United States consists of 7 tax brackets. As seen above, for married couples the tax rates are lower.

 

Your filing status changes when you get married

In the United States, your task liability is responsively related to your filing status. So once your marital status changes, it is necessary to reflect it on your tax liability.

It is usually advised that couples file jointly as there are various advantages of doing so:

  1. Jobless Spouse: filing jointly is very beneficial in a situation where a spouse is jobless. Although the tax rate remains the same for one spouse but an individual retirement account would be entitled to both spouses differently from the joint filing.
  2. Save Current Tax through Greater Charitable Deductions: having a spouse raises the limit on which charitable contributions can is deducted from the annual tax bill.

 

Cons of Marriage in the United States Tax Wise

  • The only disadvantage of getting married has on your tax rate is when your spouse already had tax complications and liabilities before the marriage, however that too can be mitigated by seeking the Innocent Spouse Relief.
  • Another disadvantage is when you do not know how to present your joint income which might shift you to a higher tax bracket as a couple.

Pros of Marriage in the United States Tax Wise

  • Marriage can help protect your estate against estate tax gain.
  • Filing jointly enables couple to benefit from additional deductions and tax credits.
  • Jobless spouse can have individual retirement account.